Turning to a Turnaround Pro

Friday

Frederick A. Henderson is charged with accelerating General Motors’s growth around the world while steering its comeback effort at home.

DETROIT — If General Motors were to design a president and chief operating officer from scratch, the new model would probably look a lot like Frederick A. Henderson.

Born in Detroit and the son of a sales manager in G.M.’s Buick division, Mr. Henderson rose through the automaker’s finance ranks and parts division to head its operations in Latin America, then Asia and Europe.

When G.M. appeared headed for bankruptcy in early 2006, he was tapped as chief financial officer, and played a major role in shaping G.M.’s North American turnaround plan and negotiating a contract with the United Automobile Workers.

Now Mr. Henderson, who is known as Fritz, is charged with accelerating G.M.’s growth around the world while steering its comeback effort at home.

The company faces substantial roadblocks to restoring profits. Chief among them is an American market with sales that analysts predict will sink to the low end of the 15-million-vehicle range this year — the worst in more than a decade.

“We’re basically operating the business at break-even, but that’s not the objective,” he said. “That’s just not good enough.”

Specifically, he said that G.M. has “another $4 billion to $5 billion of opportunity” to cut costs in North America, on top of $9 billion in costs it has shed over the last three years.

Mr. Henderson is also supervising G.M.’s vehicle introductions and tightening the expenses and schedules in its supply chain and manufacturing plants. The automaker has made progress in passenger cars with the new Chevrolet Malibu and Cadillac CTS, but Mr. Henderson is far from satisfied.

“We have to win each time we launch a product,” he said. “We don’t have the luxury of saying, well, I’m going to launch five, and if three do great, I’ll be happy.”

It is a typically straightforward approach from the former University of Michigan baseball player who said his favorite pitch was “throwing strikes.”

“Fritz has always struck me as analytical, realistic and in a hurry,” said John Casesa, managing partner of the Casesa Shapiro Group consulting firm. “Those are good traits for a C.O.O.”

Outside the United States, Mr. Henderson is focused on knitting together G.M.’s network of international units and building up operations in fast-growing markets.

“Our strategy has been that in markets where we are already large — like Brazil — to just grow,” he said. “In other markets like Russia, it’s a question of how do we expand our footprint.”

In recent days, Mr. Henderson huddled in Detroit with the top managers of G.M.’s European, Asian and Latin American operations.

He has held similar one-on-one meetings with the leaders of G.M.’s global functions, like Gary Cowger in manufacturing and Bo Andersson, head of worldwide purchasing.

Next month, Mr. Henderson will begin a methodical around-the-world assessment of G.M., starting with visits to Canada and Mexico, followed by trips to Asia, South America and Europe.

“These are highly capable people in the field,” Mr. Henderson said. “I just want to support them and get to the right decisions and get there faster.”

The automaker has not had a traditional chief operating officer since 2000, when Rick Wagoner, G.M.’s current chairman and chief executive, held the job.

“Fritz has been in the middle of everything these past couple of years, and has the respect of everyone at G.M.,” said David Cole of the Center for Automotive Research in Ann Arbor, Mich. “He is in the right place at the right time.”

Promoting Mr. Henderson also takes some of the leadership burden off Mr. Wagoner, whose global strategy was challenged in 2006 by the activist investor Kirk Kerkorian.

G.M. rejected an initiative by Mr. Kerkorian to form an alliance with the foreign automakers Renault and Nissan, but has struggled since to get its own sprawling international operations working in harmony.

Mr. Henderson’s considerable experience in overseas markets is unique, even in a company of G.M.’s size. He has, by his count, spent time in at least 45 countries on assignment, often traveling alone to visit dealers, employees and business partners.

“What I like to do is just hit the road,” he said. “There’s no substitute for putting your eyeballs on the business.”

He was the general manager of a G.M. parts operation in Saginaw, Mich., in 1997 when he was transferred to Brazil — just before the auto market collapsed in much of South America.

“I can remember when the Argentine market went from 450,000 to 130,000 units just like that,” he said. “You do remember those things.”

He ran G.M.’s Latin American, African and Middle Eastern operations from 2000 to 2002, when he was promoted to oversee the Asian region.

During his tenure in Asia, G.M. accelerated its expansion in China and bought a controlling interest in the Korean automaker Daewoo, which has since become a valuable source of small cars for sale in other markets.

Nick Reilly, the current president of G.M.-Asia Pacific, was the lead negotiator for the Korean deal under Mr. Henderson.

“Whether Fritz was in Korea, Japan, or China, he could speak with authority not just about the business, but about the culture,” Mr. Reilly said. “That is a very important element of making good decisions in those markets.”

In 2004, G.M. dispatched Mr. Henderson to Europe, where he almost immediately engineered a sweeping revamping that cut 12,000 jobs. The day the cuts were announced, German auto workers began a wildcat strike.

Mr. Henderson never wavered during the six-day strike. “We are doing the right thing,” he told his staff members. “We have to stay the course.”

Mr. Henderson brought that same resolve to Detroit in early 2006, just as G.M. was reporting a staggering $10.6 billion loss for the previous year.

“Our 2005 results were just a disaster,” Mr. Henderson said. “That was a low point.”

As chief financial officer, Mr. Henderson played a pivotal role in the sale of a majority interest in G.M.’s finance arm to the private equity firm Cerberus Capital Management. He also led negotiations on a major buyout of 34,000 factory workers and represented G.M. in talks on the reorganization of the bankrupt supplier Delphi.

“The key for Fritz was always trust, especially with the U.A.W.,” Mr. Cole said. “I think he was able to establish a level of trust with the union that had never happened with a G.M. executive.”

Indeed, after last fall’s contract talks with the U.A.W., the union’s president, Ron Gettelfinger, applauded Mr. Henderson for his role in setting up a health care trust for G.M. retirees.

Mr. Henderson’s duties had outgrown the chief financial officer role, a fact that Mr. Wagoner alluded to when announcing his promotion.

“It’s the right time to re-establish G.M.’s traditional president and chief operating officer position, and Fritz Henderson is the right person to assume this role,” Mr. Wagoner said.

Mr. Henderson brings a nearly encyclopedic knowledge of G.M.’s far-flung business units to his new job. The primary goal, he said, is to funnel G.M.’s capital into markets that offer the best returns on investment.

“We’re not limitless in our resources by any means,” he said. “We’re channeling our resources where we get the best profit opportunity on a global basis.”

Currently, G.M. is “stepping on the accelerator” in South America, China and Russia, he said. “You’ve got increasing brand recognition, great demand, and fragmented markets, which give you great opportunities,” he said. “It’s a lot easier to gain share where markets are growing.”

He is working closely with Robert Lutz, G.M.’s vice chairman and product guru, to develop vehicle platforms that can spawn models suitable for different regions.

While G.M. has been somewhat successful bringing existing European and Asian models to the American market, the long-term goal is to develop products with truly global appeal.

The company, for example, is working on a small-car platform that would cover a range of emerging markets, according to executives within G.M., who requested anonymity because plans had not been announced yet.

“The strategy of building where you sell — which was first articulated by Alfred Sloan — works,” he said.

While analysts marvel at G.M.’s size, they wonder whether the company can ever coordinate all its moving parts.

“G.M.’s biggest priority is to take advantage of its global scale,” Mr. Casesa said. “It just cannot compete with Toyota if it’s fragmented.”

At the age of 55, Mr. Wagoner appears to have several more years ahead of him as chief executive. But people who watch the industry say that Mr. Henderson is now the odds-on choice to succeed him.

“This put him squarely in line as the heir apparent,” said David Healy of Burnham Securities. Mr. Henderson will not entertain the question of whether the chief executive position is in his future, only what it will take for G.M. to succeed.

“Hey, this is all about execution,” he said. “He who executes best will win.”

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